Royally Brewed

Would you spend thousands of dollars for a rare bottle of beer on eBay?

Those inclined to roll their eyes at beer snobbery have plenty of reasons to do so these days. There are black tie awards balls and beer sommeliers called Cicerones (only six of whom have achieved the title of “Master” after grueling, multiday exams). There are elegant private tastings, spendy beer-of-the-month clubs, splashy lectures in museums, and tightly curated menus at three-Michelin-star restaurants. It’s no longer all that unusual to see single bottles listed for over $65 not only on restaurant menus, but in certain bars, too. But perhaps the best evidence that craft beer has gone completely haute is something even the savviest consumers might find surprising: a black market.

All of the factors that motivate black markets—scarce supply, high demand, and people willing to skirt the rules to make a buck—are present in the case of craft beer. The frenzy is fed by brewers who have elevated their practices to new heights of technical sophistication and an audience willing to fork out incredible amounts of money for small-run beers. The obsessive rankings of crowdsourced beer websites like RateBeer.com and BeerAdvocate.com may look like democracy at work, but the new national beer scene offers proof that the wisdom of crowds can sometimes spill over into collective insanity.

Having covered the craft beer industry worldwide since the 1990s, I thought I’d seen it all—but then I saw beer’s black market in action. At New York’s Blind Tiger bar one late afternoon last March, a slight, unsmiling young man in a dark windbreaker ordered several pints of beer from the bar, transferred them one by one to a canteen, then slipped away. “He’s going straight home to resell that on eBay,” muttered a patron standing nearby. The perishable beer in question was brewed by Shaun Hill at Hill Farmstead brewery in Vermont, which is currently rated the sixth best brewery in the world by the users of RateBeer.

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That same month, the Munster, Ind., brewery Three Floyds opened its doors for Dark Lord Day, an annual release party for its highly rated stout.* According to BeerPulse, a trusted beer news site, some 6,000 tickets sold out in four minutes, with fans driving from out of state and camping to get a good spot in line. On April 28, an eBay listing for a case of the stout appeared with an asking price of $5,000. (The listing has since been deleted.)

The most recent black-market-brew fire sale was for Westvleteren XII, a strong, rare, heavily hyped beer made by Trappist monks in Belgium. To help the monks raise money for their crumbling monastery, a limited quantity was released (legally) in the United States on Dec. 12, but the beer quickly disappeared into the hands of collectors and eBay profiteers. (Buy a six-pack for $625 here.)

It’s illegal to sell beer for consumption without a license, but thousands of beer auctions on eBay have successfully closed. Their vendors have managed this by listing their wares as “collectible containers” lacking any valuable contents, an obvious dodge that infuriates many brewers. The deals have seemed to flout both U.S. law and the site's own guidelines, and have often resulted in eye-popping prices—like this $1,300 sale of a single 12-ounce bottle. In one of the most galling recent examples, a seller in Vermont resold a magnum of sour beer blended by Belgian Lambic master Armand Debelder for Debelder’s wedding (starting bid, $90; winning 20th bid, $1,322).

Brewers like Debelder have long felt spited by these online auctions (they’re not making the incredible markup, after all), and lobbied the site to spike the practice. Shaun Hill estimated he sells 60 percent of his volume directly from his bucolic Vermont brewery, which, to his extreme annoyance, became a supply line to the black market. In response, he has placed a limit on how much individuals can buy and threatened to ban abusers for life. “People try to tell me, ‘It’s not fair. I can’t get your beer because you don’t make enough of it,’ ” says Hill. “Well, you know what? Life’s not fair. Just because you want something doesn’t mean you can have it.” EBay has started to heed brewers’ complaints—the site began pulling down auctions last summer after the president of Russian River Brewing Co. emailed a member of the site’s Global Regulatory and Policy Management team, cc’ing me and identifying me as a journalist working on a story about beer auctions— but the site has so far failed to quash the practice completely. (Asked for clarification on the summer changes, an eBay spokesperson, issued a noncommittal, boilerplate response: “We have not changed our policy. ... eBay does not allow alcohol products intended for consumption, but does allow the sale of some collectible containers.”)

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Pop culture has long regarded beer as a frat boy’s drink or a cheap accompaniment for delivery pizza—the lowest of the low brow. So why are individual bottles now commanding four figures?

One reason is that brewing has become more sophisticated—and, in some ways, more like winemaking. Some brewers have begun to age their beers like wine, which can, in the right conditions, make them more interesting and desirable, and thus more valuable. Often these beers are released in very low amounts, and it has become common to hear beer geeks talk about “verticals,” or multiple years’ worth of annual releases. Owing to supply-side variables (in annual hop harvests, for example), changes in the brewer’s formulation and aging regimens, and other factors, every release is unique.

You can taste the aging process in these beers. Most of the 100-point beers on both RateBeer and BeerAdvocate are reminiscent of the wines favored by revolutionary critic Robert Parker: intense and dark; higher in alcohol, tannins, and oak; and sometimes almost excruciatingly rich. Kirk Kelewae, service director of New York’s celebrated Eleven Madison Park, divides aged beers into two categories: barrel-aged and bottle-aged. Barrel-aged beers are matured in wooden casks, a process which imparts the flavor of the wood, adding notes ranging from vanilla to a chardonnay-like butteriness to the bracing acids of wild yeasts that flourish in wood. Most bottle-aged brews skip the oak aging, but are packaged with live yeast. “As the bottle continues to age, the yeast will go through a process called autolysis, the breakdown of yeast cells, which produces nutty and meaty flavors,” Kelewae says.

Brewers spend a great deal of time labeling, even hand-numbering, these releases, pouring them in hushed dining rooms with chef-paired dishes, and speaking in a new lexicon of beer terminology. Are some brewers merely aping the outrageous price hikes and marketing-motivated affectations of wine? Perhaps. But many beers are worthy of the cellar; as Kelewae says, “Aged beers can be a remarkable experience.” What’s more, a move toward extravagance isn’t so much a modern fad as a return to beer’s high-society past. (Catherine the Great of Russia, for instance, commissioned age-worthy, English-brewed imperial stout for her court.)

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But the right beer, aged properly, should be an enjoyable sensory experience to be savored with good friends, not a furtive, costly, clammy-handed acquisition. The larger question is, where will these beers of the new paradigm fit in the marketplace, and will new venues emerge for collectors who drink—not hoard—their best finds?

Change seems to be afoot. The craft beer revolution is now bringing beer drinkers a greater number of licensed retailers and bar owners who charge palatably lower prices than the black market offers. And recent years have seen the launch of legal beer-shipping businesses like RareBeerClub.com, BeerJobber.com, and France44.com, which carefully ship rare beers, wherever legal, for tolerable fees. These companies are forging deeper ties with brewers to get these great beers into the hands of true believers—and to get a share of the profits to the artisans themselves.

But what the craft beer world may also need is a deeper supply of these delicious barrel- and bottle-aged brews. This is far easier said than done—a fact that stokes tension between perfectionist brewers like Hill, who say they aren’t interested in endlessly expanding, and a new generation of acquisitive, know-it-all fanboys, the hard core “beer geeks” who pine to fill their trunks with the most obscure, top-rated beers and who brag-blog every hoppy conquest. The catch-22: brewers who expand to meet this demand (at major capital expense) run the risk of alienating the same fans that once eagerly lined up in the pre-dawn hours. There’s nothing so bitter in the new craft beer marketplace as the taint of selling out.

Correction, Jan. 3, 2013: This article originally stated that Three Floyds Brewing is Muncie, Ind. It is in Munster, Ind. (Return.)